This has been a very difficult past 12 months for me. It’s not just the losses from the oil markets cratering like that. The other issue is that I am looking around, now 6 years since the end of the last recession, and I just cannot quite figure out what comes next.
I usually have a pretty good handle on which way the wind is blowing. Some sort of overarching theme about what the next 5 years have in store for them. That thesis was the emergence of an American oil powerhouse that shattered old regimes. And that has sort of played out, albeit not like I expected.
But what else is going on? European countries seem keen on not burning down EU administrative buildings, which is what it would take to really break up that bureaucracy, seeing how no party in Europe appears to have the balls to hold referendums. But you can’t necessarily bet on Europe either. In my 401K, I’ve been nibbling on European indices and mutual funds since at least 2011, but there’s nothing in particular I would invest in. Nothing worthy of iBankCoin.
And what else is happening? Technology continues to undergo a multi-decade of fast paced evolution. The thing about evolution; it’s a violent, messy process. Not conducive to buy and hold at all. The consumers get rich with wonderful goods while the investors get ground to bits by emerging players and turnover. There’s only a few walls in that village, and they have a high premium attached.
My biggest reservation is that I once mapped out frequencies of recession in America, and we are fast coming due for one.
So what are your thoughts? What will the second half of this decade bring?
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I’m betting on that 24-35 year old crowd.
It’s all old school for me. They are well
educated and will inherit money to pay
debts. They will need housing and all
the other shit that boomers had to purchase to keep moving on up
Also hap tip for your $ALDW call. I followed you in.
I think it’s generally a waste of time to focus on the overall market. One day you might call a top, but you will waste all of your money shorting it. Instead, focusing on undervalued sectors with catalysts and then stocks within those sectors generally works better in my experience. Right now, I like long WMT with shorting IBB on my mind.
I just read a news thing stating that
twitter is only looking for a full time
CEO.Is there any other fucking kind.
I just might sell my shares. Google
hurry and buy these dorks and fire their
asses.
lol
More of the same. Slow growth, and low but gradually rising rates. Wage inflation could potentially provide a boost but I’m not counting on much.
Portfolio wise, I like HMHC on it becoming a better business as it transitions from a commodity textbook producer to an all in one digital education solutions provider. Earnings look like shit, but only because they are selling more digital products which are treated as deferred revenue even though the cash is collected upfront and all expenses still get booked up front. Rare instance of a company becoming a better business and its trading at a 8% FCF yield on cash flows that could grow 20% per annum the next five years.
Also like TWX for the long term. The company is becoming more Disney like and can do $8 in EPS in three years but is trading less than $90 now. Pricing goes up high single digits a year under long term contracts so lots of visibility. Base case the market puts a 15x multiple on $8 and its a $120 stock in two years, but if it can get a DIS multiple at 20x you’re looking at a double in two years on a high quality low risk franchise.
You still like $CPA
I don’t ever recall liking CPA